1 st Accreditation Webinar: “Direct Access to Climate Finance: Supporting national entities in the Republic of North Macedonia engaging with the GCF through the accreditation process” Second Readiness project Aug 12, 2020 Strengthening country capacities for climate change adaptation and mitigation and finalization of country work programme for the Republic of North Macedonia
Components of 2 nd Readiness 1. Institutional Capacity & Coordination Mechanism 2. Country Programming process 3. Direct Access to Climate Finance 4. Climate finance Strategy & Project Pipeline 2 2
» Initiate the discussion about the different modalities through which national entities can engage with the GCF. OBJECTIVE » Provide detailed information regarding the GCF accreditation process as one of the access modalities to GCF resources. » Guide national stakeholders on the steps, criteria and requirements to be met if interested in becoming a GCF accredited entity in North Macedonia. 3 3
Section 1: Engaging with the GCF 4
Working with the GCF Strong climate rationale Six Investment Criterias Country Driven Approach Compliace with GCF Policies Completeness of documentation 5
GCF Investment Criteria Strengthening country capacities for climate change adaptation and mitigation and finalization of country work programme for the Republic of North Macedonia 6
GCF Architecture » GCF business model relies on AEs for delivering its mandate and implementing its investments (P/P). » Accreditation is one of the ways to engage with the GCF . Financial Non-accredited entities can: Instruments • Submit funding proposal through an AE Grants • Partner with an AE on implementing an approved GCF P/P; Loans Co-financing projects with an already AE, and as a • Guarantees • Readiness delivery partner , entity must demonstrate relevant Equity experience and ability to implement projects. 7 7
Accredited Entity vs. Executing Entity Accredited Entity (AE) Executing Entity (EE) Develop & submit funding proposal for P/P . Develop & submit funding proposal through AE. » » Oversee P/P management & implementation Execute funding proposals » » Deploy & administrate a range of financial instruments No need for accreditation but work under » » supervision & overall management of AE Mobilize private sector capital for blending with GCF » and/or own resources 8 8
GCF Accredited Entities Strengthening country capacities for climate change adaptation and mitigation and finalization of country work programme for the Republic of North Macedonia 9
GCF IN EASTERN EUROPE & CENTRAL ASIA Strengthening country capacities for climate change adaptation and mitigation and finalization of country work programme for the Republic of North Macedonia 10
Section 2: Key elements of the GCF Accreditation Process https://www.greenclimate.fund/accreditation/process 11
About the GCF accreditation process What is the accreditation process? Thorough assessment of entities institutional arrangement & track record , designed to ensure that entities can manage the Fund’s resources according to international standards. Who can apply for accreditation? National, subnational, regional & international public/private entities When can entities star applying for GCF-AP? Any time – follow NDA prioritization procedure Who is the NDA in North Macedonia? Cabinet of the Deputy Prime Minister in Charge of Economic Affairs and Coordination of Economic Sectors https://www.greenclimate.fund/countries/north-macedonia 12
Accreditation Modalities 1. Direct Access Modality • Regional, national and sub-nation entities. • Need a nomination letter from the NDA of the country/countries they intend to operate. Normal track • May be eligible to receive GCF readiness support. Vs. Fast-track* 2. International Access Modality • Include: UN agencies, MDBs, international financial institutions and regional institutions. • Do not need to be nominated by developing country NDA. 13
Main accreditation stakeholders » NDA: Strategic oversight + provide Nomination Letter to potential NDA DAE » GCF Secretariat: 1 st filter, conduct institutional review & completeness check. Accredited GCF Board Entity » Accreditation Panel: more detailed assessment + recommend conditions for accreditation. » GCF Board: final decision (accredited an entity or withdraw its GCF Accreditation GCF Secretariat Panel application) Others: CSO Advocacy & watchdog (enhance transparency) 14
Fit-for-Purpose Approach Fiduciary functions Mandate & track record • Basic • Alignment with Fund • Specialized objectives • Project Management • • Grand award and/or At least 3 year of allocation mechanism operations • On-lending and/or blending Project size Environment & • Micro ( <10M) social risk category • Small (10-50M) • A (high) • Medium (50-250M) • B (medium) • Large ( >250M) • C (minimal or no) 15 15
Fit-for-Purpose Approach 16 16
ACCREDITATION STAGES 17
STAGE 1 - Completeness check The Online Accreditation System (OAS) is a secure internet platform through which applicant submits Application Form. Payment of Accreditation Fee: only after this fee is paid, the GCF Secretariat will conduct the Completeness Check . 18
STAGE 1I – Accreditation review & decision 19
STAGE III – Accreditation review & decision Depending on the type of entity , the » relationship between the Fund and such entity would take the form of either a legal agreement (contract governed by private law) or a legal arrangement (arrangement governed by international public law). A contract is typically entered into with a » private-sector entity or state-owned enterprise or takes the form. 20
Accreditation fee Project Size Basic Fee Additional Fee T otal projected costs at time of Fees for Specialized Fiduciary Standard: Fee Level for accreditation for application, irrespective of a) Project Management + b) Grants/funding and, Basic Fiduciary Standards +ESS + Gender portion funded by GCF + c) On-lending and/or blending a) Subnational & national entities in developing countries MICRO including SIDS and LDCs: no fee US$500 each (≤ US$10 M) b) All other entities: US$1,000 a) SIDS and LDCs: NO fee SMALL b) Subnational & national entities in developing countries, not US$1,000 each (>US$10 M ≤ US$50 M) SIDS and LDC: US$ 3,000 c) All other entities: US$5,000 MEDIUM US$10,000 US$3,000 each >US$50 M ≤ US$250 M) LARGE US$25,000 US$7,000 each (>US$250 M) Fees are NON-REFUNDABLE, regardless if the the entity is accredited or not OTHER FEES (case-by-case) if the application is reviewed by the GCF Secretariat/AP more than twice 21
Example: Accreditation fee Fee Level for Specialized Total projected costs at time Fiduciary Standard: of Fee Level for accreditation for (i) Project Management, Example: application, irrespective of Basic Fiduciary Standards, ESS and gender (ii) Grants/funding and, portion funded by GCF, (iii) On-lending/blending A national DAE from North Macedonia wishes to get accredited to manage & implement projects of a) SIDS and LDCs: no fee ≤US $50 millions, under following functions: Basic Fee: Basic Standard, ESS, Gender b) Subnational & national entities in SMALL Additional Fee = Project Management + Grants developing countries, not SIDS and LDC: US$1,000 each (>US$10 M ≤ US$50 M) US$ 3,000 Award c) All other entities: US$5,000 General Standards Specialized Standards Example National DAE = $3,000 = $2,000 22
GCF Accreditation Application II I III Scope of intended P/P Ways in which the Background and and estimated entity and its intended contact information of contribution requested P/P will contribute to the applicant entity for an individual furthering the project or activity objectives of the GCF IV VI VII V V. Environmental and Basic fiduciary VII. Specialized social safeguards standard Gender fiduciary standards (ESS) 23
Section I : Background & contact information of the applicant entity 1.1 Background and contact information • Legal name, type & of institution • Core business + Sectors that the entity operates • Registered address, website & focal point. 1.2 Background information on Track Record (P/P) • Size (cost US$) and types of P/P undertaken • Type of financial instruments deployed in P/P • E&S categories + track record with PS 2-8. 1.3 Background information on Accreditation by Other Funds or Institutions • Entities have been accredited by Global Environmental Facility ( GEF ), Adaptation Fund ( AF ), and Directorate- General Development and Cooperation – EuropeAid of the European Commission ( EU-DEVCO ). • Certain eligibility criteria apply – can be enter Fast-track accreditation modality 24
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